Management liability insurance in demand as IPO rules change

by Gill Montia

Story link: Management liability insurance in demand as IPO rules change

Marsh is predicting an increase in Initial Public Offerings (IPOs) in the months ahead, fuelling demand for management liability insurance.

The broker is basing its forecast on the early signs of economic recovery and the introduction of new rules for UK firms listing on the London Stock Exchange (LSE).

In April, new “lighter-touch” rules for UK firms listing on the LSE will enable companies to choose either a standard or premium listing, potentially encouraging more firms to go public.

The new standard listing, which was previously only available to overseas companies, means UK firms will be able to get a listing without the need to comply with what Marsh describes as “onerous” rules on corporate governance, capital raising and disclosure.

For managers and directors embarking on an IPO, insurance protection can provide peace of mind during the listing process and according to Marsh, there is “a great deal of interest” among its client base for transaction management liability policies specifically designed for the IPO.

The firm points out that this type of insurance has the advantage of not affecting a company’s directors’ and officers’ liability coverage.

In other Marsh news, the broker recently announced that it is setting up a specialist Construction Consulting Practice that will provide risk advisory and audit services across Europe, the Middle East and Africa.

The new unit, led by Todd Vandenhaak, comes under the umbrella of the group’s EMEA Forensic Accounting and Claims Service Practice.